Can MOOCs Help You To Retrain If You Lose Your Job?

The merits of globalization were quite aptly described by British economist Henry Martyn back in the 1700s. He used the analogy of technological innovation to make his point, and suggested that by using a tool (a sawmill in his case), we could perform the work of 30 men with the labor of two men.

Now of course, we could employ those 30 men instead, but that would be a waste of human resources. The same is true for most technologies, and hopefully readers of this blog would agree that we shouldn't go back on technological development.

Martyn went on to compare this with globalization, and suggested that if another country can produce textiles (for instance) more efficiently than we can, then it is akin to having a new technology to do likewise, and we should jump at such an opportunity and instead deploy our resources to trade with that nation in areas that we can excel.

An Imperfect Picture

Whilst this is a nice and logical analogy, it does nonetheless assume that people can easily be assigned from one line of work to another, and recent evidence casts a great deal of doubt upon that assumption.

The recent Brexit vote, for instance, was largely driven by post-industrial towns who have struggled to cope with the rapid pace of change in the past few decades.

The modern, knowledge based economy rewards the highly skilled like never before, with this uneven distribution of skills the biggest driver of inequality in our society, with this skills gap most prevalent in towns that were reliant upon industries that have collapsed under the weight of technological and global competition.

For years, these communities were largely written off and confined to a "managed decline," but that strategy is now coming home to roost, as those who have suffered from globalization find a voice in movements such as the Brexit vote and the rise of politicians such as Donald Trump.

Such a huge skills deficit represents an enormous waste of human potential, but the economics of re-training such huge numbers represents a significant barrier.

A report published by Wharton academics Christian Terwiesch and Karl T Ulrich a few years ago found that the cost of delivering a tenured MBA course was $57,000 ($1,475 per student). Throw in the fact that many of the post-industrial towns that have the demand, lack the supply of a quality university in their vicinity.

The same report by Terwiesch and Ulrich offers a glimmer of hope. They calculated that the cost of developing a Massive Open Online Course (MOOC) was $70,000, with a marginal cost of $7,000 each time the course is offered.